Government climbs down on private NHS clinics

The government today announced a significant climbdown in its policy on the role of the private sector in providing care to NHS patients.

Alan Johnson, the health secretary, said central government would not set up another wave of private clinics to do NHS work.

The existing two waves of independent sector treatment centres (ISTCs) have proved to be controversial, with accusations from doctors' leaders and the health select committee that they "cream off" easy operations for maximum profit, leaving difficult cases to the NHS.

Last year, Mr Johnson's predecessor, Patricia Hewitt, said there would be no limit to the role of the private sector in the NHS. But the new health secretary said it would be left to local health trusts to decide if they wanted any more ISTCs in their area.

Mr Johnson said: "There will be no need for another national independent sector procurement. I can announce today that there will be no wave three of ISTCs.

"We will instead move towards greater local determination. There will be no need for this to be run from Whitehall."

Last week, a report by the Healthcare Commission, which monitors NHS and private health services, criticised the £5bn ISTC programme for failing to provide information that would allow the clinics' work to be compared with similar services in the NHS.

Mr Johnson also announced today that it was cancelling the contract of a major private provider to the NHS as it had not fulfilled its responsibilities.

The Department of Health said it became clear that Atos Origin, a private firm supplying the NHS with diagnostic services in north-west and south-west England, was "not in a position to meet" the terms of its contract.

Mr Johnson told the Commons health select committee: "They have failed to meet certain conditions within the contracts within an acceptable time frame."

But the health secretary told MPs that ISTCs had played an "important part" in the government's health reforms, contributing "dramatic" falls in waiting times and helping to add "innovation and best practice".

Mr Johnson added that another private clinic had been approved under the second wave of the ISTC programme for patients in Cumbria and Lancashire.

Run by Capio, it is expected to carry out about 11,000 procedures a year for the NHS, including general surgery and orthopaedics. More approvals under the second wave of ISTC are expected in the coming months, the minister added.

Andrew Lansley, the Conservative health spokesman, said the decision on ISTCs marked a "clear break" with the reforms of the Blair years but added to "the confusion over the future direction of the NHS".

Mr Johnson also confirmed a cull of two-thirds of the government's NHS targets, saying there was a need for trusts to look out to their patients rather than up to Whitehall.

Norman Lamb, the Liberal Democrat health spokesman, said: "After 10 years of command and control in the NHS, this is an astonishing admission by the government that central imposition - of private provision or targets - can be damaging.